Public sector lender Indian Overseas Bank (IOB) has firmed up its fund raising plans. The board of directors of the Chennai-headquartered bank has accorded sanction for raising a total of Rs 4,150 crore on a private placement basis. Out of this, Rs 1,700 crore will be raised by way of perpetual non cumulative preference shares (PNCPS) through qualified institutional placements, Rs 250 crore by way of tier I (perpetual) bonds, Rs 1000 crore by way of lower tier II bonds and
Rs 1,200 crore by way of upper tier II bonds, the bank said in filing to BSE on Saturday. When contacted the M Narendra, chairman and managing director, IOB told FE, ?the board of the bank has passed an enabling resolution towards our long-term find raising plans. We have not decided anything for the near future?.
At a time when south-based banks are rushing in for shedding their regional image, the IOB was trying to build on its southern bank image. In Tamil Nadu alone the bank had completed financial inclusion in 519 villages and is aggressively going ahead to tap the unbanked rural segments in the state. The bank is also planning to offer kiosk banking services and business correspondent as part of its financial inclusion plan, for which it has tied up with Tata Consultancy Services. It has set a target of 2,000 villages to be covered through this scheme by 2013. The bank, which is in the process of floating a subsidiary in joint venture for providing IT solutions to various banks including cooperative banks, is looking for a technology vendor as its JV partner.
As part of its expansion plan, IOB has drawn up a target of Rs 2, 80,000 crore business by March 2011. The bank is also planning to have 3,000 branches and an equal number of ATMs in two and yealf years time. It is also on track to set up an IT subsidiary in joint venture with a well-known technology vendor for which tenders have been floated.